From a few of our recent discussions, I get the sense that some people are uncomfortable with the notion of frugality. These are some actual comments:

  • “Frugality should not be about a total excision of quality of life. Unfortunately, this is how it seems most personal finance writers talk about it.”
  • “I dislike this philosophy of ‘work hard all your life so you can retire and live a modest but comfortable life’. That’s an awful way to lead a life”
  • “All this discussion of living modestly is crap.”

I don’t mean to pick on individual commenters — these statements are representative of many that I’ve read lately. While I understand these sentiments, I think it’s important to understand that frugality is not a dirty word. In fact, frugality is a valuable skill for building wealth.

In The Millionaire Next Door, Thomas Stanley and William Danko collected and analyzed data from surveys of more than 1,000 millionaire households. They concluded:

What are three words that profile the affluent? Frugal frugal frugal. Webster’s defines frugal as “behavior characterized by or reflecting economy in the use of resources.” The opposite of frugal is wasteful. We define wasteful as a lifestyle marked by lavish spending and hyper-consumption. Being frugal is the cornerstone of wealth-building. … [Millionaires] become millionaires by budgeting and controlling expenses, and they maintain their affluent status the same way.

Frugality means choosing to make the most of your money, to focus on everyday costs, to recognize that small amounts matter. It’s nothing to be ashamed of. It’s a skill that nearly anyone can practice, and it lays the groundwork for sound financial habits that can be used throughout your life. Frugality keeps you focused on goals.

All the same, it’s important not to confuse frugality with depriving yourself. Frugality doesn’t mean living like a pauper. If you read an article someplace (even at Get Rich Slowly) that says, “Give up your daily latte and you can save big bucks,” but the concept makes you feel like you’d be cheating yourself, then don’t do it. Frugality is about making smart choices to reach your goals; it’s not about living a life devoid of pleasure.

But always keep the larger goals in mind. If you’ve adopted a lifestyle of thrift or frugality, you are not being cheap when you buy generic food at the grocery store. You are not being cheap when you don’t purchase an iPhone or a Nintendo Wii. You are not being cheap — you are choosing a different set of values. You are working toward a greater goal. You are not depriving yourself — you have elected to live debt-free, or to follow a spiritual ideal, or to save for a trip around the world.

When you adopt a frugal lifestyle, you change your value system. You may acquire less Stuff, but you could gain more time, more freedom, more peace-of-mind. Making any lifestyle change — acquiring a frugal mentality, beginning an IRA, starting a diet — requires that you remain focused on the Big Picture. If you lose track of why you’re making sacrifices, the sacrifices become a burden.

Thrift is not an all-or-nothing proposition. There are different degrees. It’s important to discover what works best for your budget and your situation. Focus on your financial goals and make conscious choices that make you happy. Don’t bankrupt your future for gratification today, but don’t live so parsimoniously that you cannot enjoy the present.

Embrace the Get Rich Slowly mantra: Do what works for you.

Frugality in Practice
Over the past eighteen months, I’ve published an irregular series exploring my own adventures in frugal living. Here are some highlights: